Research Roundup

March 14, 2024

3:36 PM PT

Olympia, WA

Something I’ll start doing with a little bit more regularity is sharing some of the things that I have been reading. I’m always absorbing a ton of information throughout the days and weeks, and I figured some of these things would be helpful to share. So anyways, here are some things that other people are saying and writing about that I think are interesting and insightful:

A lot of people have been talking about whether we are in a bubble or not. For all investors, the price you pay when you invest in something is very important. The overall market tends to go up over time, but it also fluctuates between being a better value and a worse value. Obviously, investing in a bubble would not be wise.

Ray Dalio, founder of Bridgewater, determines in his post on LinkedIn that we are NOT in a bubble.

Here is his key chart:

He says that most of the market is somewhat fairly valued, but certain parts, like the Magnificent 7 (Microsoft, Apple, Amazon, Tesla, Nvidia, Meta, and Google), are frothy.

Peter Atwater, president of Financial Insyghts and a finance professor, argues that all this talk about how we’re not in a bubble may be a good sign that investors should be more cautious.

Torsten Sløk, chief economist of Apollo, presents the following chart of the distribution of stock valuations in the market that suggests that stocks are more overvalued than they were at the top of the tech bubble.

Looking at other topics, Bob Elliott, formerly of Bridgewater and now at his own firm, Unlimited Funds, had this good post showing how gold is beneficial to investor portfolios.

Key chart:

Warren Buffett’s Berkshire Hathaway recently published his annual letter. It’s always a good read.

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